Archive for November, 2015

I return once again to the profound and proven wisdom of Jim Collins’ Good to Great. In his study of immensely successful publicly-traded companies and what made them great, he contrasted their performance to comparison companies – those of the same approximate size and markets in the same industries that did not achieve or sustain greatness. Collins’ findings are all the more compelling because they are based on empirical evidence, not management theory or untested hypotheses.

Among his many findings (see the article The Book Every Hospitality Manager Should Readon the HRI website) was the prevalence of Level 5 Leadership in the good to great companies. Many of the comparison enterprises, in contrast, followed a “genius with a thousand helpers” model. These companies attained success, in some cases spectacular, based on the unique gifts and will power of the organization’s leader, but in the end were not able to sustain that success when the leader moved on.

The same pattern is often seen in small organizations such as private clubs where a new general manager is hired to make dramatic improvements or to turn the club around. Because of the ever-present time factors and impatience of the Board and members, the leader by force of will implements the necessary changes but without investing the time to strengthen the subordinate management team. While progress is made, the foundation had not been laid for long-term success.

When the “turnaround specialist” is hired away to a more prestigious position based on his or her accomplishments or when boredom sets in after the major initiatives are accomplished, the organization is left with a weak management team that depended too much on the genius’ direction and forceful personality instead of developing their own management disciplines and leadership abilities. The end result for the club is an inability to consolidate their gains and an inevitable slide back into mediocrity and inconsistency.

In some situations the Board and membership inadvertently create the limiting environment where only the genius with many helpers model can be used by mandating such low compensation and benefits packages for the club’s department heads that a strong team cannot be built and maintained. In other instances there is a failure of the General Manager to establish clear expectations and hold subordinates accountable for their performance that gives rise to this fatally flawed management model.

So what is a club Board or General Manager to do?

First: In selecting a new general manager the Board should focus on a candidate that can produce long-term gains by building a disciplined organization and developing his or her subordinates. As a member of the search committee, I would focus on the specifics of how to go about doing this and dig for satisfactory answers. Facile responses and evasions, no matter eloquent or smooth, would disqualify any candidate.

Second: As a potential general manager I would develop an explicit game plan to develop the necessary organizational building blocks for success (see The Quest for Remarkable Service for an example). In interviews with search committees or headhunters I would explain in detail what is necessary, how I would proceed with implementation, and provide sample timelines with explicit deliverables or measures to chart and monitor progress. Finally, I would ensure the search committee understands the requisite and realistic time and resources necessary to implement the plan.

For an incumbent general manager intent upon organizational turn around or renewal, I would use the same criteria to “sell” my plan to the Board.

Third: Once hired or the plan approved, I would interview each department head in depth to ascertain background, experience, skill set, leadership abilities, and management disciplines for their position. Then I would lay out in some detail my expectations (see What I Expect from My Club Management Team) for these key managers and establish a written work plan (see Expectations, Work Planning & Performance Reviews) with measurable accountabilities, timelines, milestones, and deliverables. Over time I would hold them ever more strictly accountable for their performance.

Fourth: I would expend significant effort in training, coaching (see Coaching Your Way to Excellence), and mentoring my subordinate managers. The overall purpose of this is to identify who has the necessary desire to learn, will to succeed, enthusiasm for change, and work ethic. Those that don’t demonstrate this level of interest and commitment should be encouraged to move on.

At the same time, I’d stress the need for all department heads to develop their assistants who show promise for greater responsibility and contribution. The time and effort spent in developing the organizational depth of talent will yield both immediate and long term results. For those departments without promising assistants, I would question the hiring rationale and methods of the department head.

Fifth: Begin implementing the necessary management disciplines to better organize the operation. See 10 Disciplines that Will Transform Your Operation for an overview of these. Implementation will take time and a particular club’s needs will impact the priority of effort, but with steady focus, turn by turn of the flywheel, the club will achieve the breakthrough that will fundamentally transform the operation and achieve levels of quality, service, and success that, in retrospect, might have seemed unattainable.

In Good to Great Collins tells the story of Henry Singleton who, with single minded determination, founded and built Teledyne Corporation into a Fortune 500 company in five years based on his undeniable genius and drive. Yet when he stepped away from the day-to-day management of the company, it began to fall apart. Within 10 years without his guiding hand, Teledyne’s stock value had collapsed. As Collins said, “Singleton achieved his childhood dream of becoming a great businessman, but he failed utterly at the task of building a great company.”

So what type of leader would you prefer to be – a Level 5 Leader or the Genius with Many Helpers? The choice is yours – and you also own the results!

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the hospitality industry and its challenges. From time to time, we will feature guest bloggers – those managers and industry experts who have something of interest to say to all of us. We also welcome feedback and comment upon the blog, hoping that it will become a useful sounding board for what’s on the minds of hardworking hospitality managers throughout the country and around the world.

Common wisdom says that everyone hates meetings. But what everyone really hates are pointless meetings that drag on and on. Beyond such mismanaged gatherings is the absolute need to communicate, pass on important information, and keep all managers and staff informed.

This is especially critical in the hospitality business where there is so much detail for everyone to know and communicate, yet with the press of operations, long hours and days, and multiple shifts, it is difficult to gather staff, exchange ideas and information, and get the word out.

The first and most basic step in improving communications is a consistent service-based approach to leadership among the General Manager and department heads with its emphasis on the open flow of communications throughout the organization. This alone will uncover issues, keep the staff better informed, and ensure that everyone knows what’s expected and what’s going on.

The second requirement is that everyone responsible for holding meetings understands and consistently applies proven meeting disciplines to ensure meetings are on time, on topic, on purpose, and efficiently run with the minimum investment of everyone’s precious time.

With these two requirements in place, the following is a list of ongoing operations meetings (excluding club board and member committee meetings) that are considered essential to a well-run organization. While there may be other meetings the general manager would like to see from time to time, these may be scheduled as necessary with desired attendees:

1. Weekly General Manager’s Staff Meeting. A weekly update meeting for the General Manager and department heads, including the Controller, HR Manager, Facility Manager and heads of all operating departments. The purpose is to bring everyone up to speed on what is going on in their areas of responsibility and to give the General Manager an opportunity to give group direction, discuss issues and concerns, and review any significant club events and activities for the coming week.

2. Weekly Food and Beverage Meeting. This meeting goes over all F&B activities and events for the coming week and is usually held early in the week to allow time for menu changes, revised guarantees, and any last minute details that will affect the smooth functioning of the F&B department. The meeting is usually chaired by the Food and Beverage Director or Executive Chef and includes the Catering Director or Manager, Dining Room Manager, and any other F&B managers or supervisors who have a need to know.

3. Monthly Golf Operations Meeting. This meeting allows the GC Superintendent, Head Golf Professional, and General Manager to discuss any issues relating to the golf operation and ensures the General Manager is well-informed on events, issues, and concerns relating to the players’ golfing experience.

4. Departmental Daily Huddles. These brief meetings at the beginning of the day or before each shift give the department head or supervisor the opportunity to meet briefly with staff to discuss the day’s business, review activities and events, reinforce the organization’s culture and service ethic, go over member preferences, recognize outstanding performance, and remind staff of important service issues.

5. Monthly Review of Operating Statement and Department Work Plans. When the monthly financial statements are completed, the Controller will schedule a series of meetings for each department head to meet with the General Manager and Controller to review departmental performance and progress toward work plan milestones and completion. Department heads will bring their Tools to Beat Budget Binders to the meeting, along with their departmental benchmarks, and be prepared to respond to any questions from the General Manager.

6. Monthly Facility Maintenance/Housekeeping Meeting for the Facility Manager and/or Executive Housekeeper to brief the General Manager and discuss any and all concerns relating to his or her areas of the operation.

7. In Private Clubs, the Monthly Membership Marketing and Relationship Management Meeting to allow the Membership Director and General Manager to review marketing efforts and any member issues. In other operations the Monthly Sales and Marketing Meeting with the Sales Director and/or Marketing Director and General Manager.

8. Periodic All Hands Departmental Meetings held monthly, bi-monthly, or quarterly as the need requires and the pace of operations allows. These meetings allow department heads to inform all staff of important issues and concerns, reinforce mission and vision, clear the air, and give staff the opportunity to ask questions.

The bottom line is that in the detail and labor intensive business of hospitality management, thorough communications among management and staff is a must to promote the quality and efficient operations expected by customers/guests/members and the owner(s). Without ongoing meetings, these expectations are seldom met!

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the hospitality industry and its challenges. From time to time, we will feature guest bloggers – those managers and industry experts who have something of interest to say to all of us. We also welcome feedback and comment upon the blog, hoping that it will become a useful sounding board for what’s on the minds of hardworking hospitality managers throughout the country and around the world.

The controller fills an extremely important role in any hospitality operation’s management hierarchy. In addition to performing financial accounting, management, and reporting functions, he or she is the subject matter expert for the owner(s) and general manager on all matters relating to sound fiscal policy. As such the position of controller has specific responsibilities and requirements relating to every area of the operation and provides key information to decision-makers. Here is a summary of my requirements for the position:

1. Written standards, policies, and procedures (SPPs) for all aspects of the accounting function. Not only is this important for consistency sake, but also to make all managers and supervisors aware of their responsibilities.

2. A written internal control plan that stipulates key fiscal practices, identifies areas of potential problems, and specifies necessary separation of duties.

3. Coordinate and supervise the annual budgeting process. This requires establishing the necessary timeline and deliverables in the budgeting sequence.

5. Establish a system of real-time accounting club-wide. The Tools to Beat Budget program is an excellent example of how this can be done in all departments.

6. Assist department heads in implementing departmental benchmarking. Prepare the Executive Metrics Report and include it with the monthly financial statement.

7. Coordinate and attend the monthly review of operating statements with each department head and the general manager.

8. Conduct a review and analysis of one major cost category each month with the aim of constantly reviewing the enterprise’s cost structure and taking steps to reduce costs when opportunities present themselves. Report findings to general manager.

9. Routinely prepare the following reports:

Weekly Revenue Report for the general manager and heads of profit centers.

Pay Period Summary Report for the general manager and all department heads each pay period.

Monthly Aged Accounts Receivable Report for the general manager.

Updated cash flow projection on a monthly basis for the general manager.

10. Training of managers and supervisors in all fiscal responsibilities and requirements, including:

11. An outreach program whereby the controller visits each department head on a monthly basis to discuss needs and issues.

12. In private clubs, serve as the club’s representative on the finance committees, attending meetings, providing information as requested, making professional recommendations regarding fiscal issues, and keeping the general manager fully informed on all significant matters addressed by the committee.

A smooth accounting function requires that all members of the management team understand and meet their responsibilities in a timely and accurate manner. It is essential therefore that the controller engage with the full management team to ensure this happens. The benefits to the operation include greater real time knowledge of the enterprise’s financial performance, more timely information to support decision-making, and the full confidence of the owner(s) or board that their significant capital investment is in good hands.

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the hospitality industry and its challenges. From time to time, we will feature guest bloggers – those managers and industry experts who have something of interest to say to all of us. We also welcome feedback and comment upon the blog, hoping that it will become a useful sounding board for what’s on the minds of hardworking hospitality managers throughout the country and around the world.

The bottom line for any private club is to consistently meet or exceed the expectations of its members. Given that the members of clubs typically come from the affluent and elite segments of a community means that their life experiences have accustomed them to superior levels of quality and service. To exceed their expectations, therefore, the management and staff of a private club must be committed to quality in all aspects of its operations.

In the 1980’s and 90’s, American businesses and industries became obsessed with understanding and implementing the necessary initiatives and processes that led to the astonishing Japanese dominance in quality manufacturing. American academics and business leaders, building on the pioneering work of Dr. Joseph H. Duran, Dr. W. Edwards Deming, and others, embraced the concept of Total Quality Management (TQM) as the answer to improved competiveness.

In 1988 a major U.S. government agency defined TQM as:

“a strategy for continuously improving performance at every level, and in all areas of responsibility. It combines fundamental management techniques, existing improvement efforts, and specialized technical tools under a disciplined structure focused on continuously improving all processes.”

While many businesses and organizations embraced TQM, not all attempts were successful.

As often stated, much can be learned from failure, which demands close examination, while success is celebrated but often less well understood. In 1996 Robert J. Masters published an article in Quality Progress magazine entitled, “Overcoming the Barriers to TQM’s Success.” In this paper Masters listed eight obstacles to efforts to improve quality (shown below with our comments and resources relating to private club management in italics):

1. “Lack of management commitment. Management must commit time and resources and clearly communicate the importance and goals to all personnel.”

Service-Based Leadership places a primary focus on providing all the tools, training, resources, daily engagement, and example to provide high levels of quality and service to members. Constant communication is an essential element of such leadership, while open and Unimpeded Communication ensures that everyone in the organization is on the same page.

2. “Inability to change the organizational culture. Change takes time and effort. In order for the culture to change, the employees need to want change and be willing to participate. This requires reasons that management must convey. The change will only occur if the employees trust the management. It cannot occur from a state of fear.”

Well-defined and continually reinforced Organizational Values and a culture of service are essential to club operations. Whether you need to start from scratch to develop such a culture or you want to change an existing culture, you cannot achieve quality and service without it.

3. “Improper planning. Planning must involve all parts of the organization and be communicated clearly to employees.”

A Discipline of Planning on all levels of the organization is crucial. As we say, the importance of disciplined planning cannot be overstated. Haphazard planning results in haphazard operations and equally haphazard performance.

4. “Lack of training. The most effective training comes from senior management. Informal training needs to occur on a continual basis.”

5. “Organizational structure problems and isolated individuals or departments. Multifunctional teams will help break down some of these barriers. Restructuring is another method.”

Structure and organization are fundamental in any complex enterprise, as is the discipline of utilizing industry best practices on a consistent basis. The Remarkable Service Infrastructure is offered as an overarching plan for structuring club operations for quality and service.

6. “Ineffective measurement and lack of data. Effective decisions require that the employees have access to the necessary data.”

Benchmarking club operations in detail will provide the data to keep stakeholders informed and focused on continual improvements. Judicious sharing of the data with line employees will furnish the necessary feedback and incentives to excel in their efforts.

The first step in overcoming any obstacle is to identify it; once identified you can formulate initiatives to address it. Hospitality Resources International provides a wide variety of resources to put your club on the path to improved levels of quality and service. Whatever success you’ve achieved in your own quest for high levels of quality and service, reviewing the HRI materials may inspire or materially assist in your efforts towards excellence.

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the hospitality industry and its challenges. From time to time, we will feature guest bloggers – those managers and industry experts who have something of interest to say to all of us. We also welcome feedback and comment upon the blog, hoping that it will become a useful sounding board for what’s on the minds of hardworking hospitality managers throughout the country and around the world.